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Sunday, July 15, 2012

Top 10 Obamacare taxes coming your way

If you have yet to make up your mind about the Affordable Care Act, this list might help you decide.

1. Individual mandate

Obamacare may have been upheld as constitutional by the Supreme Court, but Chief Justice John Roberts’ extraordinary opinion clearly labeled the law’s individual mandate a tax. Whether the power to enact a penalty for failing to purchase a product derives from the Commerce Clause or Congress’ taxing authority makes little difference. Every American will have to purchase health insurance and those who don’t will face an IRS-enforced tax that totals 2.5 percent of adjusted growth income in 2016.

2. Employer mandate

At a time when America needs jobs more than anything else, along comes Obamacare and its tax on businesses that don’t offer healthcare benefits. Companies with more than 50 employees will have to pay a tax of $3,000 per employee, a sure-fire way to keep companies from hiring new workers. Perversely, this measure will also encourage some employers to drop their health coverage and pay a fine that costs less. In both cases, the measure works against many vulnerable Americans.

3. Investment income surtax

If you make more than $200,000 ($250,000 if married), then you are rich and will be paying for the healthcare of the less fortunate. Obamacare will levy a new 3.8 percent surtax on investment income on those earners. If the Bush tax cuts are not rescinded, another added tax will be added to the same people on the same income and the top rate on dividend income from will hit 43.4 percent— a good reason to invest elsewhere.

4. Limit raised on medical tax deductions

Currently people who have high medical expenses can get a tax break on the amount over 7.5 percent of their adjusted gross income when they itemize deductions. Obamacare will raise the threshold to 10 percent, socking those with medical emergencies with an extra cost just when they are least prepared to handle it.

5. Tax on charitable hospitals

Obamacare levies a $50,000 excise tax on charitable hospitals that fail to meet an array of Health and Human Services regulations, including new standards in assessing community health needs and financial assistance requirements. In what universe does this make sense? Here we have the federal government heaping new rules under threat of financial penalty onto entities that function to help others.